Economic echoes of an urban renewal thunderclap

Tell someone Lansing’s historic Ottawa Power Station is 172.2 feet tall and you might get a “hm.”

Take a friend downtown to see the big orange flame jet into the blue or tremble in the river and you’ll get an “ohhh.”

When you try to assess the economic impact of the city’s biggest renovation project ever, the same rule applies. Numbers help, but they don’t say everything.

In the short term, a lot of Lansing-area and Michigan contractors are grateful for what amounts to an unofficial economic stimulus program, timed perfectly to offset a savage economic downturn.

The project’s lasting effect to the city’s development pattern and morale will be harder to quantify, especially so soon.

While the hard hats were on, the $182 million Ottawa Street Power Station/Accident Fund Insurance Co. of America project’s impact on Lansing and Michigan could be measured with some precision. Accident Fund reported that at the project’s peak, 312 daily workers swarmed the site each day, 260 on average over two and a half years of work.

That adds up to 608,760 total project worker hours from 1,550 workers.

Out of 118 contractors and suppliers, 106 were based in Michigan, 46 in Lansing.

Lansing’s John E. Green Co. in Lansing snagged a mechanical (heating and cooling) and plumbing contract worth about $12 million. Project manager Jeff Daigle said he had as many as 30 of his own fitters and plumbers on the job at a time, plus dozens of sub-contractors in sheet metal and insulation.

“There’s not a whole lot of jobs going on that size, especially in the Lansing area, so we’re very appreciative of being on board,” Daigle said.

Lawrence Kruth of Lansing’s Douglas Steel Fabricating Corp. is also grateful for the work. “It took us through the first year of this tough economy,” Kruth said.

For many contractors, the project’s scope and uniqueness meant not just more work, but unusual challenges that required them to spend more time than usual on a worksite.

The steelworkers had to drop nine floors into the plant, replacing many of its steel bones, while working through two holes in the roof. (See related story, “Skeleton Crew.”) Daigle’s fitters had to fit a full complement of ductwork and pipes, including fire protection sprinkler lines, into an unusual underfloor system designed to conserve energy. It took over three months just to computer model the job.

There were humbler challenges, too. Despite the maze of steel beams criss-crossing the old plant, a way had to be found to pitch, or slant, the storm and sanitary pipes, no matter what.

The logo of another Lansing-based company, Homrich Inc., was a common sight during the project, especially when Tim Homrich and his demolition crew were taking down the decaying Grand Building to the north of the plant and pulling the Grand Avenue Parking deck down from the power plant’s west side. Homrich also did structural demolition inside the plant.

At the project’s peak, Homrich had 35 people on the job.

“We figure the project supported an extra 15 to 20 people we wouldn’t have had working otherwise,” Homrich said. “It played a pretty big part in bridging the gap on the way to the economy recovery.”

Even the tons of junk hauled from the site went to feed other Michigan industries. As part of a push to make the project sustainable, an amazing 96 percent of waste was diverted from landfills. Six hundred tons of concrete from the parking deck went to Lansing’s Schlegel & Sons crushers on Wood Road, to be turned into roadbeds, driveways, and other materials. Eight hundred tons of scrap steel went to Regal Recycling in Howell and will eventually find its way into cars and other products. Kruth is already using new beams marbled with melt from the Ottawa plant’s old bones.

These are big numbers, but where the future begins, the numbers begin to run out.

It’s too soon to assess the lasting economic impact of the Ottawa/Accident Fund project, a thunderclap of urban renewal that will reverberate through the 21st century.

“This thing didn’t just open the door, it blew the door down,” Trezise said.

The ripple effect begins with 557 Accident Fund employees who will move into the building by mid-April.

“It’s going to be a major perception builder right away to see the building come alive, to see people working there,” Lansing developer Pat Gillespie exulted.

Downtown, the ripples will be felt right away. The Accident Fund headquarters won’t have a full-service cafeteria, so workers will fan out to local eateries.

Last summer, Gillespie’s development company led over 2,500 tours on the Grand River to highlight his own projects, including the new City Market and his planned wraparound condos, Market Place. Gillespie admitted that the Ottawa station stole the spotlight.

“Everyone, whether they were from in town or out of town, was intrigued about the history of the building and what it was going to be.” Gillespie said. “It was clearly the focal point.”

The momentum will build this fall, when Accident Fund’s parent company, Blue Cross Blue Shield of Michigan, will backfill the soon-to-be-empty former Accident Fund headquarters at 232 S. Capitol Ave. in downtown Lansing with about 260 workers consolidated from other offices in the area.

Blue Cross President and CEO Dan Loepp said the project “will fundamentally change the city of Lansing for generations” while giving the company room to grow.

Leopp said the Ottawa project has even touched Detroit. Last year, the Blues moved all of their employees from suburban Southfield to the Renaissance Center downtown.

That makes the Blues, with 6,200 employees, the largest private employer in Detroit’s downtown business district.

Loepp said that wouldn’t have happened without the successes in Grand Rapids, where the Blues refurbished the historic Steketee’s Department Store building, helping to jump-start a troubled area of the city, or the even bigger Ottawa/Accident Fund project in Lansing.

“It gives you the confidence to make decisions you might not have the confidence to make without going through it,” he said.

Ripley Rasmus of the HOK architectural firm, chief designer of the Ottawa/Accident Fund project, isn’t shy about comparing the Ottawa Station to city-changing buildings like the Guggenheim Bilbao in Spain.

“We know from our own buildings that projects like this, in the center of cities, that are physically transformative, are often economically transformative,” Rasmus said.

It’s too early to see how far the ripples will go, he said, but they’re already radiating from the refurbished plant.

“I see immediately there’s a new farmer’s market,” he said, referring to the City Market across the river. “There’s a new walk along the river. I can see immediately the aesthetic value of taking down the existing garage.”

The buzz over the project has spread nationwide.

When the Washington, D.C.-based financial magazine Kiplinger’s picked its 10 Great Cities for Young Adults in 2011, it spiced up the usual suspects like Chicago, New York, Portland, and Austin with a way-out entry: Lansing. The accompanying article cited the city’s “youthful population, downtown renewal projects, and emerging technology center.”

City officials, designers and contractors have already started showing off the project at professional conferences, seeding more buzz in influential circles.

To get his head around the project’s boost to the city’s morale, Lansing Mayor Virg Bernero contemplated the alternative.

“To see that plant come down would have been more than a loss of a historic architectural wonder,” Bernero said. “It would have damaged the city’s psyche. To see it as a symbol of renewal does the opposite. It feeds the soul of the city.”